Saturday, August 7, 2010

Health Care Buys Medicare Solvency?

The trustees of Medicare and Social Security released a report yesterday asserting that Medicare is in better shape than previously stated in the reports of 2009. In a story released by the Associated Press, this latest release states in fact that the financial solvency of Medicare will be extended from last year's estimate by another twelve years as a result of the recent passage of health care reform legislation. Not all in government however, agree with the assessment given in this report however.

According to the story in fact, "top Medicare actuary Richard Foster warned that the report’s projections do not represent a reasonable expectation”. His skepticism comes from as a result the new reports' assumptions that call for a reduction of Medicare payments by 23% at the end of the year and 30% over the following three years, which he called “an implausible result”. Regardless of which government expert you agree with however, Medicare will run short of funding by 2029, and Social Security (which is paying out more money than it is taking in) will do likewise by 2037.

Many would suspect that a Conservative thinker would agree with Mr. Foster on the implausibility of any government program reducing costs and would be skeptical of numbers extending the financial solvency of a program that most of like minds consider little more than a sink hole of funding. While this is in fact normally the case, in this particular situation however you would be wrong. Of course, I have no hope that Congress will in fact reduce payments to Medicare either at the end of this year or in the years ahead. In fact, I suspect that legislators seeking to retain their incumbent status will do nothing to anger a senior citizen voting block that traditionally goes to the polls in high numbers.

Far too concerned with retaining their jobs in a tough economy instead, I doubt that even a return to a Republican majority in both houses of Congress will see any curb in such payments, even as deficits in this country mount. (In point of fact, I am not sure that Medicare payments to doctors is the actual culprit in this situation.) I do believe however, that a savings will come as a direct result of implementation of the Patient Protection and Affordable Care Act and that this savings will contribute to Medicare solvency, though perhaps not in a way that the Administration would like to tout as much as they seem to be.

As both the costs and the number of recipients continue to increase during the implementation of health care reform, government will likely find itself in an increasingly untenable position in trying to sustain the unsustainable. As the Canadian and British systems have shown in the past, this is likely to lead to both treatment delay and some form of health care rationing over time. Rationing of course, leads inevitably to necessary or sometimes even vital procedures not being performed in the timely fashion required by the patients condition. Since those traditionally requiring the greatest amount of health care are our aging population, it is likely that such rationing is likely to have the largest negative impact on this population segment. The conclusion to be drawn from this simple chain of logical assumption is that the growing number of senior citizens (a group to which I am far too close to becoming a part of) is likely to face a legislative or regulatory "thinning of the herd".  

And though it may sound like little more than cruelty to say so (something many would say Conservatives are particularly good at), it's hard to argue that reducing the numbers of this aging population is likely to have a positive financial impact on the funding requirements for the programs covering the medical care and retirement benefits that these programs represent, and forestall their financial demise as a consequence.

So will health care reform buy us some additional solvency in Medicare? I believe that there's little doubt that it will. The question that we should be asking ourselves however, is not whether the numbers that government is tossing around today are viable or not; but whether the price of health care reform as it's enacted is one that we are willing to pay. 



Hooda Thunkit (Dave Zawodny) said...


IMNHO, Health Care Reform and Medicare Solvency are "oxymoronic" doublespeak for "Keep electing me and things will be alright..."

Pay no attention to the man behind the curtain???

How about we set the curtain on fire?

Now, that's MY idea of progressive thought and action. . .

Tim Higgins said...


There are probably things about the health care reform law that were reasonable and necessary. Unfortunately, like an archeological treasure, they require the sifting of mounds of dirt to discover them.

And for "keep electing me...", perhaps our elected officials should look closely at the Missouri Prop Ca results.

As for setting the curtain on fire, I'm with you amigo and will bring the marshmallows.

Roland Hansen said...


Maybe, we should just cull the herd of old folks. Soylent Green comes to mind. We can drastically lower the demand for medical treatment thereby lowering costs, and concurrently provide a new food source at a very affordable cost to all.

As an aside, I wonder why no one seems to care to examine the healthcare system of Denmark.

Tim Higgins said...


I have to admit that this was a bit on my mind in putting this piece together. This is incredibly insensitive to me however, especially since we all face the prospect sooner than later.

The solution does however provide savings in both health care and retirement benefits, could potentially provide low cost food to a world in need, and does have the additional benefit of being a "green" solution.

Though a long time fan of SF, and an avid reader of Harry Harrison, I didn't recall that this was based on one of his stories. I wonder if Mr. Harrison had any of this in mind when he wrote "Make Room, Make Room" on which the story was based? I wonder if he was an evil conservative?

mud_rake said...

Minority Leader Boehner made an interesting comment on Meet the Press on Sunday. He said that "we need to have an adult conversation about the problems that we face."

He said this in answer to host Gregory's question about whether Boehner and the GOP want to raise the SS retirement age to 70.

I suspect that Boehner actually doesn't want such a conversation, but was rather 'blowing smoke.'